Shutdown Over Sale
The future of TikTok in the US remains uncertain as ByteDance, the app's parent company, faces a difficult choice. A new bill signed by President Biden mandates the sale of TikTok to a US company within a year or face a ban. However, ByteDance seems determined to keep the app under its control, even if it means shutting it down in the US.
Several factors contribute to ByteDance's reluctance to sell. Firstly, TikTok's contribution to the company's overall revenue and user base is relatively small. A shutdown would have a limited impact on ByteDance's business. Secondly, the company considers its algorithms, which power TikTok's recommendation engine, to be its "secret sauce" and a core asset. Sharing or selling these algorithms is not an option for ByteDance.
Furthermore, disentangling TikTok from its algorithms would be a complex and near-impossible task. The algorithms are intertwined with other ByteDance apps, making separation impractical. Additionally, ByteDance would be hesitant to hand over its competitive advantage to rivals.
Despite the challenges, ByteDance is exploring legal options to challenge the legislation. CEO Shou Zi Chew remains optimistic about winning the legal battle and keeping TikTok operational in the US.
The situation remains fluid, with the deadline for a sale set at January 19, 2024. President Biden has the authority to extend the deadline by three months if he deems progress is being made. Whether ByteDance can find a solution that satisfies both the US government and its own interests remains to be seen.